The Central Bank is considering creating a “self-help” fund for banks

The head of the banking regulation and analytics department of the Bank of Russia, Alexander Danilov, said that the regulator would think about creating an autonomous fund to support banks so that they “could save themselves.” According to him, banks are ready to cancel the easing and can comply with the surcharges at the current level. Next week, the Central Bank plans to publish a list of easing for credit institutions, which will be extended or expire this year.

Speaking at a conference of the Association of Russian Banks (ARB), Mr. Danilov said that the Central Bank does not see the need for systemic additional capitalization, since the regulator already gives strong relief on markups in order to “soften the blow.”

“But for the future, of course, we need to think about creating an autonomous support fund so that banks can save themselves, so that state funds or something else is not required urgently. This will also reduce the burden on the insurance system,” he said (cited by Interfax).

The head of the department of banking regulation and analytics of the Central Bank said that the regulator is preparing a big press release about which concessions it will extend and which will not. “I think that we will probably have to publish it next week,” said Alexander Danilov.

To help banks cope with the consequences of Western sanctions, the Bank of Russia introduced temporary regulatory easing this spring. For example, banks were allowed to fix the rate and value of securities on the balance sheets of the previous levels of assigned ratings. As a result, lenders avoided significant capital cuts and were able to adapt without stopping lending. Also, the Central Bank dissolved the macro allowances accumulated by banks for all types of loans.

Daria Erozbek